Challenges are many for the agriculture and forest products exports community. We're pleased the Federal Maritime Commission is recognizing that attention is required in the interest of keeping US international commerce flowing in a manner that allows US exports to compete effectively in the global marketplace.
A policy of the Ocean Shipping Reform Act is, "to promote the growth and development of United States exports through competitive and efficient ocean transportation and by placing a greater reliance on the marketplace."
In fact, as virtually all engaged in the international cargo supply chain recognize, we are less efficient in certain aspects. Our allowable truck weights are far lower than that of Canada, Mexico, Europe. This means those who ship heavy cargoes such as paper, lumber, agriculture, and beverages, etc., must send, for example, four trucks whereas the Canadian competitor only needs to send three trucks.
This creates unnecessary congestion on our freeways, rail ramps, marine terminals. It exacerbates the driver shortage. Fortunately, certain states are already embracing truck efficiency, while efforts continue to create a national uniform standard. Filling the void, we’re encouraged that Class I railroads are increasingly considering and investing in shorter feeder lines directly into ports, which can reduce congestion and delays at the terminal gates and inside the terminals.
This is urgent as “free time” penalties continue to mount for detention and demurrage. Ocean carriers must better understand that their actions, from bringing massive ships into terminals not built to handle such container volumes, to providing unrealistically short free time, is unsustainable.
Our exports are price-sensitive with many international competitors that can supply virtually the same product, often without the supply chain challenges faced by US exporters. As demurrage/detention penalties are piled on, our exporters get priced out of the global market, and the freight stops flowing.
Finally, we are closely monitoring the shift of import container market share from West Coast gate gateways to the East and Gulf coasts. If the trend continues as it is projected, it will provide additional containers for our exporters located in the Midwest and East, but will create equipment shortages for those exporters whose cargo originates in the western United States.